Choose your loan insurance plan very carefully
- 9TH SEPTEMBER 2007
When it comes to choosing your loan insurance plan then you have to choose it very carefully and take into consideration the exclusions within all policies. Loan insurance can be an excellent product providing it is bought correctly but many who have bought it alongside their loan from the high street lender have bought anything but peace of mind when purchasing their loan insurance plan.
The high street lender often gives very little information when they sell their plans alongside their loans, this was one of the main reasons a huge investigation into the sector began in 2005 by the Citizens Advice; the Financial Services Authority (FSA) and the Office of Fair Trading (OFT). The sector was then referred to the Competition Commission who hopes to have their review of the payment protection insurance industry completed by early 2009 and it is hoped, many changes for the better will arise.
A loan insurance plan is taken out to ensure that if you come out of work due to an accident, sickness or unemployment you would have an income to ensure that you would be able to keep up with your loan repayments. It will start once you have been out of work, typically for 30 days and provide you with a fixed monthly income for up to 12 months and in the case of some providers 24 months.
The cheapest way to purchase your loan insurance plan is by going with a standalone provider. An ethical specialist in loan payment protection insurance such as British Insurance will ensure that you get all the information needed in order to make a decision on the policy’s suitability. Common exclusions include being retired, being self employed, having a pre- existing medical condition and only being in part time employment.
British Insurance is headed by the very outspoken Simon Burgess who is always campaigning for the consumer when it comes to them getting a better deal when they want to buy a loan insurance plan. He says: “Currently the high street lender monopolises the sector charging high premiums and mis leading the consumer into thinking they have to take the cover alongside the loan which is just not true.”
He advises: “Stick with a standalone payment protection specialist and get several quotes for your loan insurance plan and make good use of the advice an ethical specialist will give you to ensure you could claim on your policy should the need ever arise.”
